Bank managers need to be evaluated to see if they are doing a good job and consideration needs to be given about possibly better qualified individuals to run the institutions, FDIC chief Sheila Bair told Bloomberg.
In an interview with Bloomberg’s Al Hunt, he noted that the government had already replaced chief executives at Fannie Mae, Freddie Mac and General Motors in similar situations.
“And some people say, well, why is the head of Bank of America still there? Or why are some of these other banks' CEO's still there?” Hunt asked.
Bair replied: “I think the review needs to go with both the management and the board as well, absolutely.”
Hunt then asked: “Do you think some will be replaced and in the next couple of months?”
Bair said, “Yeah, I think there will be an evaluation process. We’re requesting it as part of the capital plan and yes.”
The FDIC said in a statement today that “management changes could happen based on the capital plans that an institution must submit to the government.”
“She did not refer to CEOs specifically and the comment was in the context of capital plans submitted by the institutions. Chairman Bair also did not suggest the federal government will remove the bank CEOs.”